Question

Question 3: Briefly state and explain your own view. Do you support California's legislation which has set up scheduled minimum wage increases to $15 per hour by 2023?

Answer 1

Minimum wage is the level of wage set above equilibrium market wage , to be effective . This law is implemented to protect the interests of workers and prevent exploitation of workers . But minimum wage has a prime adverse effect on the economy and that is unemployment . At the minimum wage level the amount of labour demanded is lesser than labour supply in the economy . This excess labour cannot find jobs and the income inequality in the economy rises . If California cannot generate more jobs then minimum wage setting can increase unemployment in the economy . So I do not support this legislation .